NextEra, Brookfield to Build $100 Billion Data Center Campus
(Bloomberg) -- NextEra Energy Inc., the largest US power utility, is teaming up with Brookfield Corp. on a more than $100 billion transformation of a shuttered Cold War uranium-enrichment facility in Kentucky into a data center campus with a generating plant.
The privately funded effort will include construction of a 2-gigawatt natural gas-fired power plant at or near the government site in Paducah in western Kentucky, and as much as 2.6 gigawatts of battery storage capacity, the US Energy Department said Wednesday. One gigawatt is roughly the output of a traditional nuclear plant and can power about 750,000 homes.
The project comes as the Trump administration is trying to address surging power demand from data centers that are provoking considerable political opposition. Failure to add new electric capacity would threaten a key priority for the US president — winning the AI race against China — and worsen the spike in electricity prices that could represent a political liability come the November midterm elections.
There’s “a lot of interest” in developing data centers and power generation on federal lands, Energy Secretary Chris Wright said during a Bloomberg Television interview.
“You’ll certainly see more of this,” Wright said in a separate interview. “If we can use existing federal lands to get private capital investment to grow energy production, and AI production and jobs we’ll do the all day long.”
The privately funded investment, one of the largest in Kentucky’s history, is expected to create 8,000 construction jobs and 600 permanent positions, the department said.
Brookfield Asset Management Ltd. will develop and operate the data center campus, which will occupy portions of the sprawling 3,556-acre Energy Department site once used to produce weapons-grade uranium and fuel for nuclear reactors. Operations using the now obsolete enrichment technology known as gaseous diffusion stopped in 2013, and the site is now subject to cleanup efforts. Construction is expected to be completed in 2031, the Energy Department said.
Sikander Rashid, Brookfield Asset Management’s global head of AI Infrastructure, said in an interview the firm will use its Brookfield Artificial Intelligence Infrastructure Fund for its portion of the project investment.
Brookfield Corp. shares fell 1.6% and NextEra declined 0.9%.
The project, which also includes partnerships with local electric cooperatives, comes as soaring demand for artificial-intelligence tools has touched off a worldwide expansion of data centers. The buildout has touched off concerns across the US about increasing costs for water and electricity. The Trump administration has been trying to address those concerns ahead of the midterms by, among other things, exacting pledges from technology companies that they’ll pick up the costs.
SoftBank Group Corp. said earlier this year that a data center campus it was developing on another former Energy Department enrichment site in Ohio could be as large as $500 billion.
(Updates with comment from US energy secretary in fifth paragraph.)
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